Electronic money (EMI) and payment institutions (PI) continued their strong growth trajectory in Q3 2024, with licensed activity revenue increasing by over 22% to EUR 431.4 million. The total value of payment transactions also surged by 37%, reaching EUR 141 billion compared to the same period in 2023.
According to Denas Jonas Gadeikis, Head of the Payment and E-Money Institution Supervision Division: “The increase in licensed activity revenue is substantial, and institutions are largely adhering to capital requirements. However, we observe a trend of decreasing client funds held in central banks, with an increase in investments into secure assets and deposits, potentially influenced by upcoming regulatory changes.”
Market Growth and Licensing Trends:
- As of September 2024, Lithuania had 80 EMIs and 43 PIs.
- Three new licenses were issued, two institutions expanded their licenses, and eight institutions were acquired.
- Five licenses were revoked due to voluntary decisions or regulatory violations.
- The top 10 institutions accounted for 70% of payment transaction value (EUR 95 billion) and 65% of total revenue (EUR 280 million).
Client Funds and Investment Trends:
- Funds held in central banks decreased by 12% year-over-year to EUR 736 million (28% of total client funds).
- Investments into secure and liquid assets rose by 50%, reaching EUR 697 million.
- Deposits increased threefold to EUR 400 million, reflecting shifting market strategies.
Compliance and Supervision:
- By Q3 2024, one institution failed to meet capital requirements, while 11 institutions met only the minimum thresholds.
- The Bank of Lithuania emphasized the importance of institutions building sufficient capital buffers to mitigate potential expenses or operational losses.
- Three regulatory examinations were conducted, focusing on AML, fraud risk management, customer due diligence, equity capital, and internal controls.
- Three enforcement actions were imposed, and two institutions had temporary representatives appointed.
- The Bank of Lithuania also held nine meetings with financial market participants and issued 18 advisories on areas for improvement.
Sintesi Consulting can help you with:
– Complying with the regulative requirements of the Bank of Lithuania;
– Legal issues, prepare necessary documents and represent your company at the Bank of Lithuania.
For more details, you can access the document here.
If you have any further questions – get in touch!
E-mail: martynas.kalvaitis@sintesi.lt; mobile phone: +370 656 96055.
